Two proteins, barnase, the extracellular ribonuclease of Bacillus amyloliquefaciens, and barstar, its intracellular inhibitor, are used as a model system for the study of protein folding and protein-protein interactions. Barnase is one of an homologous group of ribonucleases occurring in both prokaryotes and eukaryotes. Recombinant DNA techniques are being applied with three major aims: (1) to facilitate production of wild-type and mutant proteins; (2) to examine the structural and control sequences of the genes; and (3) to make specific changes in the sequences to test theories of folding and to probe the barnase-barstar interaction. Both proteins can now be obtained from recombinant genes in E. coli where expression of barstar counters the lethal effect of barnase expression. The structures of both proteins and their complex are known. A fast and relatively precise assay has allowed the development of techniques for studying the kinetics and stability of complex formation. The barnase-barstar interface is being explored by an in vivo technique which selects suppressor mutations which rescue the system from lethal mutations that interfere with barnase inhibition. For example, barnase (H102K) with wild-type barstar is conditionally lethal in the appropriate vector. Several mutations at Tyr29 and Tyr30 of barstar allow greater production of the mutant barnase and bind more tightly to the mutant barnase in vitro. Structural studies of several such mutant combinations are under way. Barstar also inhibits a group of RNases from Streptomyces strains. These enzymes are distantly related to barnase with a sequence identity of only 25%. Among themselves, identity ranges from 40% to 70%. The structures of two of the enzymes are already known from work on nonrecombinant material. A collaborative effort is under way to apply this group, along with barnase and its closer relatives, to structural and folding studies, alone and in combination with barstar. We have the genes for four such enzymes expressed in E. coli with the aid of the barstar gene. For three of these, yields are already in the 50-100 mg/ml range. For RNase St, tighter control of enzyme synthesis is required but the enzyme can be produced at a low level. Isolation and cloning of putative homologs of barstar and in vitro evolution of the barstar gene are being pursued. Work elsewhere, in which the barnase gene becomes a tissue-specific killer when attached to eukaryotic promoters, has aroused considerable interest in its use in developmental studies and as the key to a variety of anti-viral strategies.